Financial Conduct Authority  

FCA asks companies to delay accounts amid market turmoil

FCA asks companies to delay accounts amid market turmoil

The Financial Conduct Authority has asked all listed companies to delay publishing any financial accounts following an unprecedented two weeks of market turmoil.

The financial watchdog wrote to companies on Saturday night (March 21) which were due to publish preliminary financial statements in the coming days, asking them to delay their plans for at least two weeks. 

The spreading coronavirus crisis has caused global markets to tumble as governments across the world shut borders, lock down domestic travel and close businesses. 

The upheaval forced the Bank of England to slash interest rates to a record low of 0.1 per cent last week as it battled to boost the economy against the pandemic.

In an update on the weekend the regulator said: "Investors in capital markets rely on trustworthy information on the companies whose instruments they trade. 

"The unprecedented events of the last couple of weeks mean that the basis on which companies are reporting and planning is changing rapidly.

"It is important that due consideration is given by companies to these events in preparing their disclosures and observing timetables set before this crisis arose may not give companies the necessary time to do this."

The FCA warned listed companies and auditors were facing "unprecedented practical challenges" during the coronavirus crisis and issuing preliminary financial statements ahead of a full audited report was adding "unnecessary" pressure.

Issuing preliminary financial statements is a common practice among UK-listed companies, but they are only strictly required to publish full audited financial statements within four months of the financial year end. 

The FCA said: "[We are] in talks with the Financial Reporting Council and the Prudential Regulation Authority about a package of measures aimed at ensuring companies take the necessary time in these uncertain times to prepare appropriate disclosures and address current practical challenges and the three bodies intend to announce details shortly."

In a statement this morning the Financial Reporting Council backed the move. 

It said: "The FRC therefore encourages listed companies and their auditors to consider carefully whether they should delay other corporate reports for the next two weeks, such as interim financial statements and final audited financial statements, except where necessary to meet a legal or regulatory requirement."

rachel.mortimer@ft.com 

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